RB says he is happy with 2010 budget

President Rupiah Banda says he is happy with the performance of the 2010 National Budget whose expenditure began in January following the change in the Budget Cycle.

President Bnada expressed satisfaction that Ministries and spending agencies were receiving funding, which should enable them to begin to implement projects early in the year unlike in the past where the Budget was only passed in March. The President directed all controlling officers not to delay the implementation of key projects, especially in health and education.

President Banda noted that the year 2010 had begun on a sound note and his Government will seek to consolidate the gains achieved last year where the country’s economy recorded positive growth. He noted that the single-digit inflation rate, which was recorded at 9.9 percent as at 31st December 2009, had further declined to 9.6 percent as at January 2010.

The President observed that the economy has remained resilient since he took office in November 2008 and managed to record a GDP growth of 6.3 percent in 2009, which was beyond the 4.5 percent target. He is optimistic that the country is likely to consolidate on that growth and achieve the targeted 7 percent growth rate in 2010.

President Banda further expressed satisfaction with the level of the country’s international reserves that have risen to over US$ 1.8 billions, which is about four months of import cover. The President also noted that the exchange rate has also remained stable with the local currency – Kwacha – trading at around K4, 600 to the US dollar. He observed that, as inflation continues to decline, prices are expected to remain stable, particularly food prices as the country has enough food stock to last until the next farming season.

President Banda has also observed that the prices of copper increased and have remained relatively stable and that most mining companies have resumed full production following the scale-down in operations due to the financial crisis of last year.

He said his Government will this year focus on infrastructural development, especially in improving the health facilities, schools and roads. He expressed happiness that World Bank president, Mr. Robert Zoellick recently offered to provide financing for major projects in Zambia such as roads.

The World Bank indicated that it is able to offer Zambia financing under the International Bank for Reconstruction and Development (IBRD) for major projects which ensures satisfactory economic return.

However, the President said his Government will consider the offer after carefully evaluating the various financing options so that any borrowing done continues to ensure debt sustainability limits. In this regard, the Government will engage the World Bank in negotiations once the projects to be financed have been agreed upon.

President Banda’s pronouncements are contained in a state,ment from State House